Buying retail, selling wholesale

[Walterp]

Adam Smith was fond of 'the natural price' of grain - in a world without economic shocks, that price which was above the cost of production and allowed the farmer to remain solvent.

That was 200 years ago, but farmers today still fondly believe that they are entitled to receive a 'natural price' for their efforts. Farmers smile knowingly and declare "it'll all be fine when we start getting a fair price for our food".

Which is, of course, rubbish - food has always been extracted from the rural population upon the cheapest possible terms, and always will be, because power is urban. John F Kennedy may have put it slightly differently, but the idea remains the same.

Farmers diversify, intensify, and rely on the wife's outside earnings in order to carry on producing food that, self-evidently, isn't being sold on at a fair price. Nor ever will be, if farmers stay true to their nature and carry on farming even if there's no money in it.

Is it because they don't know what else to do?

 

[Pond digger]

Adam Smith was fond of 'the natural price' of grain - in a world without economic shocks, that price which was above the cost of production and allowed the farmer to remain solvent.

That was 200 years ago, but farmers today still fondly believe that they are entitled to receive a 'natural price' for their efforts. Farmers smile knowingly and declare "it'll all be fine when we start getting a fair price for our food".

Which is, of course, rubbish - food has always been extracted from the rural population upon the cheapest possible terms, and always will be, because power is urban. John F Kennedy may have put it slightly differently, but the idea remains the same.

Farmers diversify, intensify, and rely on the wife's outside earnings in order to carry on producing food that, self-evidently, isn't being sold on at a fair price. Nor ever will be, if farmers stay true to their nature and carry on farming even if there's no money in it.

Is it because they don't know what else to do?

Yes, partly, and so long as they can survive, it will always be thus. However, there are plenty of farmers that do other things to top up farm income: isn’t that also the case for many European farmers? Everyone can’t be niche producers, can they? The basic food staples will always be produce at a slim margin.

At the end of the day, some folks are happy to just plod along, and why not if they’re happy enough.

 

[7610 super q]

So......we should be grateful for subs, so that we can continue our hobby ?

 

[Pond digger]

So......we should be grateful for subs, so that we can continue our hobby ?

If you like.

 

[Clive]

Maybe the fair trade label we see on overseas produce should apply to uk producers as well

I think there are places in the world where it’s not legal to pay less than the cost of production ? Would that be a good law and get rid of the need for subs ?

 

[Poorbuthappy]

Maybe the fair trade label we see on overseas produce should apply to uk producers as well

I think there are places in the world where it’s not legal to pay less than the cost of production ? Would that be a good law and get rid of the need for subs ?

How do you set that COP?

Walter I would venture it's not because they don't know what else to do, but because they don't want to do anything else.

 

[Clive]

How do you set that COP?

Walter I would venture it's not because they don't know what else to do, but because they don't want to do anything else.

I’m sure there must be ways to set it

Not simple but neither is a sub system

 

[Kiwi Pete]

As previously posted, many won't even entertain following the next steps in the journey for their beloved bovines and high welfare wheat - the power is urban, as you said - that scares most farmers back into repairing things with bale-band and muttering about fairness.

It is hard to explain relativity to a snail: even if you tell him "if you run over there, that music sounds much louder than it does over here".
The snail can not run, and the primary producer can not afford to invest in manufacturing or retail.
Most won't even fully learn how their ecosystem processes work (in their lifetime); preferring instead to believe rumours about it, and what that lecturer said at college.

Hardly a recipe for overwhelming success, I venture?

Getting things to grow is child's play - but all the death on agriculture's hands requires an adult and funding.

Polyculture lies beyond the imaginations of most farm CEOs, even though it is a self-improving and regenerative system the farmer chooses the other path, 9 times out of ten.
Thus the basic commodity price is not at fault, but the cost of production rising to meet the revenue is.

This model is in need of more tape.

 

[7610 super q]

How do you set that COP?

Walter I would venture it's not because they don't know what else to do, but because they don't want to do anything else.

Some truth in that....your hobby allows you to live in a nice house, in a nice spot in the country, be your own boss ( despite the efforts of Red Tractor ).

 

[Lazy Sod]

If farmers received only the cost of production, there would still be no profit to live on and re-invest in the business.

 

[yellow belly]

I’m sure there must be ways to set it

Not simple but neither is a sub system

But the costs of an owner of land paid for in the 20 century are lower

Cost plus systems can keep the inefficient who are lucky in business

We stoped subsidising energy iron and ship building 30 years ago when much lower cost product could be sourced

One example in the 1970 iron stone with double the content could be delivered to the steel works in Lincolnshire from Australia for less cost per tonne than using Lincolnshire stone 230 people lost their jobs in my village
The difference is that food relies on the vagaries of the weather and the cycle of production is longer than a year but storing food in reserve is considered uneconomic

 

[Cowabunga]

I’m sure there must be ways to set it

Not simple but neither is a sub system

Tesco and others set a cost-plus price for their dedicated suppliers milk and it was at least 8ppl more than their other suppliers were getting at the time and a good bit more than we currently get, even though costs have increased substantially since then.

 

[DrWazzock]

Lets face it, big or small, it's a hobby.

While it's enjoyable it's alright.

But it's getting less and less so as as it becomes more corporate.

There could be a crunch coming.

 

[DrWazzock]

I already notice around here that we have more and more short term "extractive" farming arrangements.

The dairy farms went first. These are now grazed by suckler herds or stores that come for the summer and sheep over the winter. No fertiliser or lime is applied, no compaction alleviated. Gradually the rushes and buttercups are taking over.

The arable land is similar. Short term FBT arrangements until either blackgrass or structure and nutrients are depleted, then it's put up for sale.

It feels like the fag end of British agriculture round here at times except for the good land which is still worth farming and never changes hands on the open market.

 

[newjames]

Power is not urban, power is in the hands of the hungry, all revolutions that i have any knowledge of have started due to the lack of or the cost of food, the worker will moan and groan about pay and conditions but will carry on, but when his wife and kids are hungry and dying due to lack of food he takes up arms regardless of the risk to himself, governments know this and use many ways to keep food cheap, allways have always will.

 

[Still Farming]

Title - Arse backwards ???

 

[Kiwi Pete]

Title - Arse backwards ???

Pit deep?

 

[Hindsight]

I’m sure there must be ways to set it

Not simple but neither is a sub system

There are ways but if the COP was a legally enforceable level then lets hazard a guess the COP would increase to reflect this legally enforceable price level. It would in effect be another quasi subsidy which would be capitalised into the COP. Hey ho that is economics.

 

[digger64]

I already notice around here that we have more and more short term "extractive" farming arrangements.

The dairy farms went first. These are now grazed by suckler herds or stores that come for the summer and sheep over the winter. No fertiliser or lime is applied, no compaction alleviated. Gradually the rushes and buttercups are taking over.

The arable land is similar. Short term FBT arrangements until either blackgrass or structure and nutrients are depleted, then it's put up for sale.

It feels like the fag end of British agriculture round here at times except for the good land which is still worth farming and never changes hands on the open market.

This is really caused by area payments and enviro schemes and consequently forage shortages extra costs and poor stock performance , this also means a laissez fair attitude from the agent / advisor who benefits from the admin etc and supposedly guaranteed income by mistake advising the owner with their shortterm vision, Whether or not the risk taker can make it work or not doesn't matter -if he needs a new gate he will just have get one as you don't need a gate to claim

 

[bluebell]

to be powerful in a demorcacy you need strength in numbers, thats one of the reasonsthe farming lobby in france is powerful, a generation a go most people who lived in the country had some connection with farming, thats the shame of how are farming has gone one large farming company farming many farms, where say 20yrs ago they all were farms in there own right, i do wonder where it will all end, they keep saying the larger farms have still got to get bigger to survive, but how big? big so only one farm in essex all the rest whats left either hobby farms, or country parks for the masses living in the thousands of new homes built on once farmed land? God help us if their was a national emergency like the last war?/